Levels of Retention

When it comes to creating a good business strategy those in charge need to look at the different ways their customers can relate to their business. An individual customer can have many unique kinds of relationship with a company, and each one must be nurtured in order to not only maximise revenue but to boost their reputation and reach, increase customer loyalty and improve customer retention.

With 53.5% of all new members terminating their memberships within 12 months, addressing the problem with customer retention has never been more vital. In the world of health and fitness, the levels of retention can be separated into various categories. In this article we explore each one in detail examining how gym owners can tap into them, communicate and resonate with their existing and potential customers, and help ensure that their relationship remains strong and positive, therefore lowering the number of members who may become at-risk.

Retention Level 1: The Brand

For any business, getting the branding right is essential. Good branding will ensure that your company’s unique voice is heard, that what your business stands for is clear and that your tone appeals to your target audience. It needs to make a memorable impression and for that impression to be impressive. It gives the company identity and creates a sense of trust within the marketplace.

When creating their branding, gym owners should think about who they are appealing to and what they are trying to say. In the Harvard Business Review’s ‘Elements of Value Pyramid,’ social impact comes top, that means that customers care, perhaps now more than ever, that a brand is socially responsible and holds similar values to their own.

Branding is uniquely powerful in that people can feel they relate to a brand without actually knowing much about it or having any direct contact or experience of that brand. However, in terms of health and fitness, a good branding strategy not only attracts new gym members but also benefits levels of retention and reduces the number of at-risk members by creating a sense of pride in being affiliated with the brand and increasing members sense of loyalty towards it. Gym owners should be alert for anything that might damage their branding and reputation as even a perfectly satisfied member could become at-risk if they no longer feel that their views align with what the business stands for or if a once favorite brand falls from grace and is viewed as unethical or uncool – think the Kendall Jenner Pepsi ad.

How a member associates themselves with the gym as a brand is naturally linked to levels of retention, as while a member can be connected at a product level, i.e. connected to their gym membership, if they are not connected to the brand, the provider of that membership, they won’t feel that sense of loyalty to stick with that particular provider, and are therefore more likely to become at-risk.

Retention Level 2: The Industry

People can relate to an industry if it aligns with their interests and beliefs. A person can also be persuaded to take an interest in an industry that they had not previously cared about if their interests dramatically change. For example, a person previously unbothered about health and fitness may have a health scare and suddenly want to know everything about it.

Businesses, therefore, must pay attention to what is happening within the industries in which they operate. For example, new trends in the health and fitness industry, if incorporated into the gym, may impress current members thus increasing member retention rates, as well as attract new ones. Paying attention to the latest news in the industry and communicating this back to members also shows that the gym has a vested interest in their health and has positioned themselves as an expert on such matters, and with over 38,000 fitness centres in the US, it is important to stay ahead of the competition!

Becoming a thought leader and incorporating new trends into the business demonstrates a level of care that goes above and beyond just providing products and services and thus strengthens the relationship gym members have with their gyms. Having an emotional connection is imperative, and the more a member feels looked after on a personal level, the more motivated they are to become part of the community and less likely they are to leave the gym.

Retention Level 3: The Products and Services

The quality of products and services a business offers are naturally linked to how satisfied their customers become. Even if a company has excellent branding and has proven themselves to be experts in their industry none of this will matter if the products and services they offer are not adequate. Nothing is more damaging than negative reviews and the most frequent cause for complaint is if a customer feels short-changed by the quality of products or the level of service a business provides to them.

In terms of a gym membership, this means that owners must continuously review their pricing strategies, the range of services they offer, the quality of their customer service and the standard of gym equipment and facilities provided. Staying competitive in all categories is essential for it is important to note that while a customer can be extremely connected to the services the gym offers if they are not loyal to that particular organisation or it no longer provides them with what they need, they could become at-risk. Members who don’t have to queue for equipment, who are impressed with the standard of equipment and classes, as well as additional facilities such as changing rooms and social spaces, will feel as though they good value for money which is imperative in keeping levels of retention high.

The way a member relates to the gym is also deeply rooted in how connected they feel to it. If a gym dedicates time to nurturing positive relationships with individual members, for example, by motivating employees on the gym floor to talk to members and encourage them, or by organising social events or group exercise sessions, even offering free classes, competitions or discounts they can strengthen the sense of community in the gym. Doing so can increase positivity and encourage members to keep returning to exercise because they view the going to the gym as a positive and sociable experience. This Forbes article discusses why relationships matter as much as products and services in greater detail.

From the above, it is evident that there are different levels of retention and for gym owners to operate at the highest level, they need to devise smart marketing and retention strategies to nurture each one. It is a combination of engaging members across all levels that will lead to minimising the number of at-risk members and improving retention rates overall, as even failing to do so on one level, despite having continual positive engagement through the others, could mean a member decides to cancel their membership regardless.